Re:Bitcoin mining becomes unprofitable as BTC price falls to...
by londons_explore on Sunday June 19, 2022 @03:53AM
(#31797215)
> miners who aren't making ideal financial decisions,
We seem to have lots of these. In the last few months, the price of bitcoin is down 60%, yet the mining rate has barely decreased. Surely at least some miners have been priced out of the market now?
Re:Bitcoin mining becomes unprofitable as BTC price falls to...
by somenameforme on Sunday June 19, 2022 @11:35AM
(#31800323)
It seems to me that if a company wants to get out of mining then the first thing they're going to do is to liquidate their hardware. And that hardware is going to get flipped right back on by somebody else. Supporting this view would be what happened after China banned mining. The hashrate collapsed about 50%, but then spiked back to higher than ever in a period of 3 or so months. So if we ever see a "real" decline in hash rate, it would probably take a very long form as hardware fails and isn't replaced/repaired.
As the hash rate gets more and more decentralized price tolerance approaches infinity. Some guy running a small number of ASICs at his house is going to have near zero price sensitivity.
Totally possible, but I don't think it will happen simply because there will always be some percentage of miners who aren't making ideal financial decisions, or who are using free electricity. Those miners will eventually bring the network back into operation, although you're right, it might take months.
Having said that, the bitcoin core developers really ought to be considering ways to fix this risk without making bitcoin too vulnerable to network splits (which is the flip side of the same issue - if there was suddenly a world war and the internet gets split into many country-nets, how do we want the network to behave?)